Dell pins hopes on new Windows 8 tablets, touch PCs

Dell has confirmed that it hopes to launch new touchscreen PCs and potentially tablets running the much-anticipated Windows 8 operating system.

Yesterday, the US company reported sales of its notebook computers and other mobile devices were down by 10% year-on-year over the three months to May 4, 2012.

The slump in sales was blamed on competition from cheap products in emerging markets, an area Dell does not operate in.

Shares in Dell were down 13% in after hours trading, following the company's announcement of a 33% fall in first quarter earnings to $635m (£404m). Revenue declined 4% to $14.4bn, although the company's consumer unit reported a sharper fall of 12%.

In a call with analysts, Dell founder and chief executive Michael Dell said that he expects demand for PCs to improve after Microsoft releases Windows 8 later in the year.

Michael Dell feels that this will be a driver for people to purchase new touch-enabled hardware, rather than just upgrade their existing kit to the new software.

"Unlike other Windows transitions, this is a transition where you generally are going to need a new PC, whether it's a tablet or ultrabook with touch or a notebook with touch or a PC with touch or some derivative hybrid on all the above type of products," Mr Dell was quoted as saying by the Seeking Alpha website.

"The product refresh cycle associated with this release of Windows is likely to be very different from other releases, but it's hard to know exactly what that looks like. We're preparing a full complement of products, and we'll be ready with those."

Dell feels that the new touchscreen PCs will be higher price items, meaning they will not fall into the cheaper end of the market that the company has avoided.

The US firm has previously attempted to crack the tablet computers with its Latitude and Inspiron tablets, running existing versions of Windows, along with the Streak tablets running Google Android.

But Windows 8 is being viewed as the opportunity for companies like Dell to create devices that can truly compete with Apple's iPad and Amazon's cheap Kindle Fire, which runs Android.

Chris Green, a technology analyst at Davies Murphy Group Europe, told the BBC: "We see Windows 8 as opportunity for all the PC manufacturers to reclaim the huge ground that they have lost to Apple and some of the other Android tablet makers.

"You can't underestimate how much the sector has hit PC sales. The challenge for Dell is that it will be competing against Acer, Lenovo and others - but the sheer size of the company should act as an advantage."

Despite having high hopes for the consumer launch of Windows 8, Michael Dell said that he is not expecting such instant success among business customers.

"Corporations are still adopting Windows 7, so we don't think there'll be a massive adoption of Windows 8 by corporations early on," he said.

"But certainly, the addition of capacitive touch capability into Windows 8, we think, will be a welcome addition and will have a full complement of products at time of launch."